Ethereum co-founder Vitalik Buterin lauded Coinbase's Base network. He called it a model Layer 2 solution that balances user experience and Ethereum's decentralized security. He noted that, while Base employs some centralized features for speed and convenience, it does not have custody of users' funds. Therefore, it cannot steal or prohibit withdrawals. The smart contract logic on Ethereum's base layer ensures that users' assets are protected even if the base operator fails.
Buterin stated that Base meets Stage 1 decentralization standards. That is, a security council can overturn contracts, but a quorum-blocking minority outside of Coinbase prohibits unilateral control. He stated that Base and comparable L2s are actual extensions of Ethereum, not simply servers that report transaction hashes. Coinbase's Head of Base Jesse Pollak described Layer 2 sequencers as neutral "traffic controllers." They enable faster, cheaper transactions anchored in Ethereum. Coinbase intends to take further measures toward decentralization, including the development of a native coin.
Skeptics are concerned about the ongoing dangers of centralization and regulatory questions regarding whether Layer 2 sequencers should be recognized as exchanges. Buterin acknowledged the vulnerabilities, but emphasized that user funds are still protected by on-chain Ethereum technology.
